Digital Britain: BIG things are happening

My wife was shopping online this past week. While she was watching the rich-media cat walk feature on asos.com, which is now the norm for clothing retailer websites, it occurred to me how things have changed. Moreover, how our expectations have dramatically evolved.

On a regular basis I hear friends, colleagues and business partners complain about the perceived speed of their internet connection – web pages not loading fast enough, unable to reach a particular website, or a poor user experience on Skype. Consumers are demanding more – more broadband speed, better applications and abundant availability.

Let’s go back in time to 15 years ago, when I was a teenager, and we all were content with very basic online connectivity. I remember our family’s first PC at home — it came equipped with dial-up internet access, chugging along at 56kbps. This was our gateway to a world of new possibilities.

Notable Advances in Online Retail

The path of our evolution included some potholes. Back in 1998 a new company was born, boo.com, which was later considered one of the biggest flops in internet history — not because of their business model, but because (in hindsight) they were too far ahead of their time.

The Boo.com online experience theoretically allowed consumers to have a 360 degree view of the product on display. However, in practice, viewing this multimedia rich website via an analogue modem was very problematic. Fast-forward to the present day and asos.com can, in contrast, deliver a vastly superior shopping experience — due to the availability of residential broadband internet access services.

But it wasn’t just boo.com that had a business plan somewhat ahead of its time. Back to 1999 you could order your groceries online via webvan.com, and request a prompt delivery to your door. The concept seemed a good fit for the busy lifestyles of many consumers. But this experiment also failed to reach expectations.

The intended webvan.com innovation stumbled partly because of the unsatisfactory online experience, coupled with their decision to quickly spend $1 billion on their physical delivery network of vehicles. Now, jump forward only 3 years later, as internet speeds were increasing and becoming more widely available, the delivery network of Ocado (via Waitrose) enabled it to become a successful online grocery service.

Anticipating a Multitude of e-Commerce Applications

A key factor that determined the success or failure of these start-ups was the pervasive access to the essential telecom infrastructure. That said, some people believe that symmetrical broadband speeds are often inadequate for today’s rapidly growing interactive HD video applications such as YouTube. Some already complain they experience a slow response from websites via their smartphones, even while using the latest 3G wireless networks.

To date, this demand of faster broadband has been driven by the consumer markets with currently 20% of all internet traffic being video. But with the shift that is currently happening, Cisco predicted in its most recent VNI report, that by 2015 this figure will be nearer 90% of all internet traffic will be video – with the charge predominately being led by business users.

With the ever increasing mobile application (App) market and more and more people using their smartphone or tablet devices to shop online — or perhaps access their bank account — mobile service providers must continue to invest in their wireless broadband network capacity.

If more mobile apps rely upon cloud-based services, then service providers will once again need to anticipate the increased demands on their essential network platform. They’ll need to install more fibre optic backhaul circuits from a growing number of cell sites. They’ll certainly need to expand their intelligent network coverage. It’s an acknowledged imperative for the continued evolution of 21st century e-commerce and m-commerce (Mobile-Commerce).

For readers in the US, Joanne Bethlahmy, one of the authors of the paper "Want Growth? Build Online Stores" will be at moderating an e-commerce Roundtable at Shop.org Annual Conference on September 14th, 3:30pm in Boston.
http://events.nrf.com/summit11/Public/SessionDetails.aspx?SessionID=1574

Another area of impact to bandwidth is also in the convengence physical and the online shopping experience. As new generation of consumers are used to video-based experience in their online shopping, they will expect related content and similar experience on their mobile phone and in the stores that they visit.
This means Wi Fi in the store so retailers can provide their brand content to keep the customers in the store and also video in the form of digital signage and video based clienteling with remote expert. All this designed to facilitate shoppers to shop anytime, anywhere on any medium that they wish.
Kenneth Leung
Cisco Global Retail Marketing Manager

@Victoria, thank you for sharing the link to this insightful report.
The GDP stats are particularly interesting -- I think all nations would benefit from tracking this key metric, and perhaps the primary metro areas within their country. Here's the UK GDP data points that I'm referring to.
"In 2009, the internet contributed an estimated 100 billion pounds (sterling), or 7.2 percent to the UK economy"
"The UK internet economy is likely to grow by 10 percent per year, reaching ten percent of total GDP by 2015"

Very informative post about the history and future of online shopping. I can't remember the last time i purchased something in a store. Almost all of my shopping is done online. I have converted my family and even a lot of friends into online shoppers. I feel that if you are not keeping up to date with technology and all that is has to offer, you will truly be left behind the rest of the world.
I agree that the speed some sites load is not as good as it can be, but that's expected with the amount of users currently trying to access that given site.

Great post - this is an area that is important for the UK economy and was highlighted in a report by the Boston Consulting Group last year (http://www.connectedkingdom.co.uk/downloads/bcg-the-connected-kingdom-oct-10.pdf)

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